China released its inflation numbers last night throwing off the party attitude from the other markets. Surpassing most expectations, inflation in China rose to 2.7%, the highest in 16 months and up 1.5% from the January numbers. The trading markets lost footing and slide down on the news release and the futures took a step backwards, but not for long as most markets recovered.
Around the world:
Asia
Japan revised their GDP down a little and the Nikkei liked it. Up 1% by the time their gong chimed. Hang Seng and Shanghai both ended up just slightly green despite the hot inflation news and the likely hood that some brakes were going to be applied to this run away Toyota.
Europe
Europe isn't buying it and is trading down just around -.5% perhaps waiting for some leadership from the US.
United States
Economic news
8:30 am is Unemployment Claims and 10:30 will be the Natural Gas numbers. Last weeks natural gas numbers sent the NG tumbling let's see if they get a little bounce or more down draft today.
Earnings
Imax reported today and guess what? Their top line was up almost 100% and that only included 12 days of Avatar. They managed to hit their expectations of 0.06 a share up from the 0 .11 loss a year ago. Should be a good year for the IMAX theaters and and owners as 3D movies are lining up.
Breadth Charts
40 DMA % Index
Still looking strong here and putting up the most bullish numbers scoring a +6 today. I am still waiting for the curl, maybe sometime today.
10 Day High - Low
The NAZ would not generate a chart today but we will assume that it tracks close to the NYSE and RUT which are actually flashing top here and have put in a -2 score today with the RUT making both a lower daily bar and both the NYSE and RUT's momentum now moving to the downside. If we close green today the momentum will move back into bull territory. The take away is that we are losing some of our upward momo here and may beginning to stall. The data is set up to have a fairly weak day today and still put in good numbers. So I would say cautiously bullish to neutral.
52 Week New Highs
Still scoring off that nice looking 5 DMA momentum indicator, even though we are putting in lower daily bars as the market catches breath here the momentum is still moving along. This chart scores a +2 today as the Nasdaq was on fire yesterday and put in a higher daily bar.
Conclusion
| Chart | Score |
| 40 DMA % Index | +6 |
| 10 Day High - Low | -2 |
| 52 Week New Highs | +2 |
| Total | +6 |
The charts still default to the bullish side today. Not as strong as earlier in the thrust but the Nasdaq showed some real leadership yesterday as it broke out of the pack. Still waiting for the SP500 and NYSE to move up out and over into new rally highs. A weak opening today is setting up to make that a little more difficult.
$SPX
Come on SPX.. your lagging behind... Still unable to break its January highs like its sisters Russell 2000 and the Tech heavy Nasdaq it even looks like a potential stall here with an intraday lower high in place at 1147. Today is the day, just 5 points away. I have moved the 1120 line now up to 1133. The 1120 is still THE most important support line here but it is too far away now so we will make 1133 the bottom of our box protecting 1120. 1140.50 needs to hold this morning and that will be a test as we will most likely open just above that number. A sell off to below would indicate some weakness. I would be a buyer at 1140.50 looking for a bounce. I would think that with all this upward momentum we would at some point test that 1147 area again to see if we can break out and charge to 1150.
Bulls Plan: Close up the gap and defend the 1140 area as the low of the day. Run up to 1147 and break through.
Bears Plan: Take advantage of the gap down opening for further selling. Break through 1140 and convince everyone we have a head-n-shoulders on the 15 minute and dive for the 1136.75 area with a goal of getting down to 1133.40. That will shake things up for the Friday and going into the weekend.
Good luck in the markets-- Hope to see you in the room: http://ttthedge.acrobat.com/traders
marlin - aka RedlionTrader
